FIVE-YEAR SENIOR REVOLVING CREDIT AGREEMENTRevolving Credit Agreement |
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Exhibit 10.1
$2,000,000,000
FIVE-YEAR SENIOR REVOLVING CREDIT AGREEMENT
Dated as of September 9, 2005
by and among
CINERGY CORP., THE CINCINNATI GAS & ELECTRIC COMPANY, PSI ENERGY, INC. THE UNION LIGHT, HEAT AND POWER COMPANY
and
THE BANKS NAMED HEREIN, as Lenders,
JPMORGAN CHASE
BANK, N.A.,
and
BARCLAYS BANK PLC, as Administrative Agent and as LC Bank
BARCLAYS
CAPITAL,
and
J.P. MORGAN
SECURITIES INC.,
TABLE OF CONTENTS
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ii
FIVE-YEAR SENIOR
REVOLVING
FIVE-YEAR SENIOR REVOLVING CREDIT AGREEMENT dated as of September 9, 2005 (this “ Agreement ”), by and among:
a) ` CINERGY CORP., a Delaware corporation (“ Cinergy ”);
b) THE CINCINNATI GAS & ELECTRIC COMPANY, an Ohio corporation (“ CG&E ”);
c) ` PSI ENERGY, INC., an Indiana corporation (“ PSI ENERGY ”)
d) THE UNION LIGHT, HEAT AND POWER COMPANY, a Kentucky corporation (“ ULH&P ”).
e) ` the banks and other financial institutions or entities listed on the signature pages hereof (the “ Banks ”) and other Lenders (as hereinafter defined) from time to time party hereto;
f) JPMORGAN CHASE BANK, N.A. (“ JPMCB ”) as Syndication Agent (in such capacity, the “ Syndication Agent ”); and
g) BARCLAYS BANK PLC (“ Barclays ”) as Administrative Agent (in such capacity, the “ Administrative Agent ”) for the Lenders hereunder and as LC Bank (as hereinafter defined).
W I T N E S S E T H
WHEREAS , the Borrowers (as defined herein) have requested the Banks to provide the credit facility hereinafter described in the amounts and on the terms and conditions set forth herein, the Banks have so agreed on the terms and conditions set forth herein, and the Administrative Agent has agreed to act as agent for the Lenders on such terms and conditions;
NOW , THEREFORE , the parties to this Agreement hereby agree as follows:
ARTICLE I
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Applicable Margin |
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Applicable |
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Base Rate |
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Eurodollar |
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Level I |
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0.000 |
% |
0.220 |
% |
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Level II |
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0.000 |
% |
0.350 |
% |
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Level III |
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0.000 |
% |
0.425 |
% |
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Level IV |
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0.000 |
% |
0.500 |
% |
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Level V |
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0.000 |
% |
0.800 |
% |
Any change in the Applicable Margin caused by a change in the Applicable Rating Level shall take effect at the time such change in the Applicable Rating Level shall occur.
“ Applicable Rating Level ” shall be determined at any time and from time to time on the basis of the then applicable Reference Ratings of the relevant Borrower issued or maintained by the Rating Agencies (or Rating Agency, in the case of only one Reference Rating) in accordance with the following table:
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Applicable |
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S&P |
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Moody’s |
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Level I |
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A- or higher |
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A3 or higher |
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Level II |
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BBB+ |
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Baa1 |
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Level III |
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BBB |
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Baa2 |
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Level IV |
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BBB- |
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Baa3 |
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Level V |
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BB+ or lower |
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Ba1 or lower |
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In the event of a “split” rating for a Borrower, the Applicable Rating Level shall be determined on the basis of the higher of the two ratings then applicable; provided that if the two ratings are two or more levels apart, the Applicable Rating Level shall be determined on the basis of the rating that is one level lower than the higher of the two ratings then applicable; provided further , that if both Moody’s and S&P shall have ceased to issue or maintain Reference Ratings, then the Applicable Rating Level shall be Level V. The Applicable Rating Level shall be redetermined as and when any change in the ratings used in the determination thereof shall be announced by any Rating Agency. For the avoidance of doubt, the Applicable Rating Level as of the date of this Agreement (i) for Cinergy, is Level III and (ii) for CG&E, PSI Energy and ULH&P, is Level II.
“ Approved Fund ” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
“ Assignment and Acceptance ” means an assignment and acceptance in substantially the form of Exhibit E hereto.
“ Assignment Effective Date ” means the effective date of any Assignment and Acceptance.
“ Barclays ” has the meaning specified in the caption to this Agreement.
“ Barclays Capital ” means Barclays Capital, the investment banking division of Barclays Bank PLC.
“ Base Rate ” means, for any day for which the same is to be calculated, the higher of (a) the rate designated by Barclays from time to time as its prime rate in the United States of America and (b) the Federal Funds Rate for such day plus 1/2 of 1%. Each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the rates described in clause (a) or clause (b), above, or in the Applicable Rating Level, as the case may be.
“ Base Rate Advance ” means an Advance which bears interest as provided in Section 2.8(a).
“ Borrower ” means each of Cinergy, CG&E, PSI Energy and ULH&P; collectively, the “Borrowers”.
“ Borrowing ” means a borrowing consisting of simultaneous Advances of the same Type and having the same Interest Period made by each of the Lenders pursuant to Section 2.1.
“ Borrowing Date ” means any Business Day specified in a Notice of Borrowing as a date on which a Borrower requests the Lenders to make Advances hereunder, or such Business Day on which a Borrowing pursuant to Section 3.4 is made.
“ Business Day ” means a day of the year on which banks are not required or authorized to close in New York City and, if the applicable Business Day relates to any Eurodollar Rate Advances, on which dealings are carried on in Eurodollars in the London interbank market.
“ Capital Stock ” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants or options to purchase any of the foregoing.
“ Cash Account ” has the meaning specified in Section 7.1.
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“ CG&E First Mortgage Trust Indenture ” shall mean the first mortgage trust indenture, dated as of August 1, 1936 between CG&E and The Bank of New York (successor to Irving Trust Company), as trustee, as amended, modified or supplemented from time to time, and any successor or replacement mortgage trust indenture.
“ CG&E Outstanding Extensions of Credit ” means, as of any day for the determination thereof, (a) the aggregate principal amount of all Advances made to CG&E outstanding on such day plus (b) the LC Outstandings of CG&E on such day plus (c) the aggregate amount of all Unreimbursed LC Disbursements of CG&E outstanding on such day.
“ CG&E Sublimit ” means $500,000,000.
“ Change of Control ” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of Capital Stock representing more than 35% of the aggregate ordinary voting power represented by the issued and outstanding Capital Stock of Cinergy; (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of such Borrower by Persons who were neither (i) nominated by the board of directors of Cinergy or the applicable Borrower nor (ii) appointed by directors so nominated; or (c) any of CG&E, PSI Energy or ULH&P shall cease to be wholly-owned direct Subsidiaries of Cinergy (or, in the case of ULH&P, so long as it is a wholly-owned direct Subsidiary of CG&E, a wholly-owned indirect Subsidiary of Cinergy); provided , that references to each Borrower in this definition of “Change of Control” shall also refer to any successor entity as may be permitted by Section 6.2; provided further , that the transaction described in the Agreement and Plan of Merger by and among Duke Energy Corporation, Cinergy, Deer Holding Corp., Deer Acquisition Corp., and Cougar Acquisition Corp., dated as of May 8, 2005, as disclosed in Form 8-K filed by Cinergy with the Securities and Exchange Commission on May 10, 2005, and other filings made by Cinergy at least five Business Days prior to the Effective Date with respect to such transaction, shall not be considered a Change of Control under subclause (a) or (b) above for purposes of this Agreement.
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time.
“ Commitment ” has the meaning specified in Section 2.1(a).
“ Commitment Increase ” has the meaning specified in Section 2.17.
“ Commitment Increase Effective Date ” has the meaning specified in Section 2.17.
“ Commitment Percentage ” means, as to any Lender as of any date of determination, the percentage describing such Lender’s pro rata share of the Commitments set forth in the Register from time to time.
“ Consolidated Indebtedness ” means, for any Borrower, as of the date of any determination thereof, the principal amount then outstanding of all Indebtedness of such Borrower and its Subsidiaries, determined on a consolidated basis after elimination of inter-company items, less deposits of cash or cash equivalents in restricted accounts relating to the proceeds of tax exempt bonds of such Borrower and its Subsidiaries as of such date; provided that Consolidated Indebtedness shall not include (i) Non-Recourse Debt or (ii) in the case of Cinergy only, Indebtedness in respect of Preferred Trust Securities.
“ Consolidated Net Worth ” means, as of the date of any determination thereof, all items that, in conformity with GAAP, would be included under shareholders’ equity on a consolidated balance sheet of the applicable Person at such date.
“ Consolidated Total Capitalization ” means, as of the date of any determination thereof, the sum of Consolidated Net Worth of the applicable Person at such date, the Consolidated
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Indebtedness of such Person at such date, and, to the extent not otherwise included, preferred stock and mandatorily redeemable preferred trust securities of such Person at such date.
“ Contractual Obligation ” means any provision of any security issued by the applicable Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“ Default ” means any event, which, but for the giving of notice or lapse of time or both, would constitute an Event of Default.
“ Disclosure Document ” means (i) the Borrowers’ Annual Report on Form 10-K for the fiscal year ended December 31, 2004 and any report of any Borrower on Form 10-Q or Form 8-K filed since December 31, 2004 and five Business Days prior to the Effective Date or (ii) for the purposes of satisfying the requirements of Section 2.18(b)(ii) only, the Borrowers’ Annual Report on Form 10-K for the most recently ended fiscal year and any report of any Borrower on Form 10-Q or Form 8-K filed since the filing of the Borrower’s Annual Report for the most recently ended fiscal year and five Business Days prior to the effective date of the relevant Termination Date extension.
“ Domestic Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Domestic Lending Office” opposite its name on Schedule 1.1 hereto or in the Assignment and Acceptance pursuant to which it became a Lender, or such other office of such Lender as such Lender may from time to time specify to the Borrowers and the Administrative Agent.
“ Effective Date ” means the date on which all of the conditions specified in Section 4.1 hereof have been satisfied.
“ Environmental Law ” means any and all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or other governmental restrictions relating to the environment or the release of any materials into the environment.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that is under common control with any Borrower within the meaning of Section 4001 of ERISA or is part of a group which includes the Borrower and which is treated as a single employer under Section 414 of the Code.
“ ERISA Event ” means (a) the occurrence of any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived under PBGC Reg. §4043); (b) the occurrence of any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) with respect to a Plan; (c) the existence with respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (d) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (e) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by the borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (g) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the “withdrawal” or “partial withdrawal” (as such terms are defined respectively in Sections 4203 and 4205 of ERISA) from any Single Employer Plan or Multiemployer Plan; or (h) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from
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the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability (or that would reasonably be expected to result in Withdrawal Liability) or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
“ Eurocurrency Liabilities ” has the meaning specified in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.
“ Eurodollar Lending Office ” means, with respect to any Lender, the office of such Lender specified as its “Eurodollar Lending Office” opposite its name on Schedule 1.1 hereto (or, if no such office is specified, its Domestic Lending Office) or in the Assignment and Acceptance pursuant to which it became a Lender, or such other office of such Lender as such Lender may from time to time specify to the Borrowers and the Administrative Agent.
“ Eurodollar Rate ” means, for the Interest Period for each Eurodollar Rate Advance comprising part of the same Borrowing, an interest rate per annum equal to the average (rounded upward to the nearest whole multiple of 1/100 of 1% per annum , if such average is not such a multiple) of the rate per annum determined on the basis of the rate for deposits in U.S. dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “ Eurodollar Rate ” shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent or, in the absence of such availability, by reference to the rate at which the Administrative Agent is offered U.S. dollar deposits at or about 11:00 A.M., New York City time, two Business Days prior to the beginning of such Interest Period in the interbank eurodollar market where its eurodollar and foreign currency and exchange operations are then being conducted for delivery on the first day of such Interest Period for the number of days comprised therein.
“ Eurodollar Rate Advance ” means an Advance which bears interest as provided in Section 2.8(b).
“ Event of Default ” has the meaning specified in Section 7.1.
“ Excepted Subsidiaries ” means CG&E, PSI Energy and ULH&P.
“ Existing Credit Agreements ” means the Existing Five-Year Credit Agreement and the Existing Three-Year Credit Agreement.
“ Existing Letters of Credit ” means the letters of credit described on Schedule 3.9.
“ Existing Five-Year Credit Agreement ” means the Five Year Senior Revolving Credit Agreement, dated as of December 9, 2004, by and among Cinergy, the lenders parties thereto and Barclays, as administrative agent for such lenders.
“ Existing Three-Year Credit Agreement ” means the Three Year Senior Revolving Credit Agreement, dated as of April 26, 2004, by and among Cinergy, the lenders parties thereto and Barclays, as administrative agent for such lenders.
“ Extension of Credit ” means (a) the making by any Lender of an Advance, (b) the issuance of a Letter of Credit by the LC Bank or (c) the amendment of any Letter of Credit having the effect of extending the stated termination date thereof or increasing the LC Outstandings.
“ Facility Fee ” has the meaning specified in Section 2.3(a).
“ Federal Funds Rate ” means, for any day in any period, the rate set forth for such day opposite the caption “ Federal Funds (Effective) ” in the weekly statistical release designated as
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“ H.15(519) ”, or any successor publication, published by the Board of Governors of the Federal Reserve System.
“ Financing Documents ” means this Agreement and the Notes.
“ Financing Lease ” means any lease of property, real or personal, the obligations of the lessee in respect of which are required by GAAP to be capitalized on a balance sheet of the lessee.
“ GAAP ” means generally accepted accounting principles in the United States of America in effect from time to time.
“ Governmental Authority ” means any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.
“ Guarantee Obligation ” means, as to any Person (the “ guaranteeing person ”), any obligation of such Person guaranteeing, or having the effect of guaranteeing any Indebtedness, leases, dividends or other obligations (“ primary obligations ”) of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, contingently or otherwise. Guarantee Obligations shall include (but not be limited to) any obligation of the guaranteeing person (i) to reimburse or indemnify any bank, insurer or other Person in respect of payments made under any letter of credit, demand guaranty or similar instrument issued by such bank, insurer or other Person (ii) to purchase any primary obligation or any property constituting direct or indirect security for any primary obligation, (iii) to advance or supply funds for the purchase or payment of any primary obligation, (iv) to advance or supply funds to maintain working capital or the net worth or solvency of any primary obligor, (v) to purchase property, securities or services primarily for the purpose of providing funds to assure payment of any primary obligation or (vi) otherwise to assure or hold harmless the creditor or beneficiary of any primary obligation against loss; provided , however , that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the related primary obligation and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be the guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined in good faith.
“ Hazardous Materials ” means any hazardous materials, hazardous wastes, hazardous constituents, hazardous or toxic substances, petroleum products (including crude oil or any fraction thereof), defined or regulated as such in or under any Environmental Law.
“ Hedging Agreement ” means, for any Person, any and all agreements, devices or arrangements designed to protect such Person or any of its Subsidiaries from the fluctuations of interest rates, exchange rates applicable to such party’s assets, liabilities or exchange transactions, including, but not limited to, dollar-denominated or cross-currency interest rate exchange agreements, forward currency exchange agreements, interest rate cap or collar protection agreements, commodity swap agreements, forward rate currency or interest rate options, puts and warrants. Notwithstanding anything herein to the contrary, “Hedging Agreements” shall also include fixed-for-floating interest rate swap agreements and similar instruments.
“ Indebtedness ” means, as to any Person, (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services (other than current trade liabilities incurred in the ordinary course of business and payable in accordance with customary practices) or which is evidenced by a note, bond, debenture or similar instrument,
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(b) all obligations of such Person under Financing Leases, (c) all obligations of such Person in respect of bankers’ acceptances (or similar instruments) issued or created for the account of such Person, and (d) all liabilities secured by any Lien on any property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof.
“ Increasing Lender ” has the meaning specified in Section 2.17.
“ Interest Period ” means, for each Eurodollar Rate Advance comprising part of the same Borrowing, (a) initially, the period commencing on the date of such Advance or conversion, as the case may be, and ending on the last day of the period selected by the relevant Borrower pursuant to the provisions below and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Rate Advance and ending on the last day of the period selected by the relevant Borrower pursuant to the provisions below. The duration of each such Interest Period shall be one, two, three or six months as the relevant Borrower may select in its Notice of Borrowing or Notice of Conversion, in the case of (a) above or in its Notice of Continuation, in the case of (b) above; provided , however , that:
(i) any Interest Period which would otherwise end after the Termination Date shall end on the Termination Date;
(ii) Interest Periods commencing on the same date for Advances comprising part of the same Borrowing shall be of the same duration;
(iii) any Interest Period commencing on the last Business Day of any calendar month, or any day for which there is no numerically corresponding day in the applicable subsequent calendar month, shall end on the last Business Day of the applicable subsequent calendar month; and
(iv) whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day; provided , that if such extension would cause the last day of such Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day.
“ JPMCB ” has the meaning specified in the caption to this Agreement.
“ LC Bank ” means Barclays, in its capacity as issuer of any Letter of Credit pursuant to Article III hereof.
“ LC Outstandings ” means, for any date of determination, the aggregate maximum amount available to be drawn under all Letters of Credit outstanding on such date (assuming the satisfaction of all conditions for drawing enumerated therein).
“ LC Sublimit ” means, as of any day for the determination thereof, $500,000,000.
“ Lenders ” means the Banks listed on the signature pages hereof, each other bank or financial institution that shall become a party hereto pursuant to Section 9.7(a), and, if and to the extent so provided in Section 3.5(d), the LC Bank.
“ Letter of Credit ” means a letter of credit issued by the LC Bank pursuant to Article III, as such letter of credit may from time to time be amended, modified or extended in accordance with the terms of this Agreement.
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“ LIBOR Reserve Percentage ” of any Lender for the Interest Period for any Eurodollar Rate Advance means the reserve percentage applicable during such Interest Period or such term (or if more than one such percentage shall be so applicable, the daily average of such percentages for those days in such Interest Period or such term during which any such percentage shall be so applicable) under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for such Lender with respect to liabilities or assets consisting of or including Eurocurrency Liabilities having a term equal to such Interest Period or term, as the case may be.
“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement and any Financing Lease having substantially the same economic effect as any of the foregoing.
“ Long-Term Debt Designation ” has the meaning specified in Section 2.6(c).
“ Material Adverse Effect ” means, with respect to any Borrower, a material adverse effect on (a) the business, operations, property or condition (financial or otherwise) of such Borrower and its Subsidiaries taken as a whole, (b) the ability of such Borrower to perform its obligations under this Agreement, or (c) the validity or enforceability of this Agreement or the rights or remedies of the Administrative Agent or the Lenders hereunder.
“ Material Indebtedness ” means, with respect to any Borrower, Indebtedness (other than Indebtedness under this Agreement), Guarantee Obligations or obligations in respect of one or more Hedging Agreements of such Borrower and its Subsidiaries, in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of such Borrower or any Subsidiary of such Borrower in respect of any Hedging Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that such Borrower or such Subsidiary would be required to pay if such Hedging Agreement were terminated at such time.
“ Material Subsidiary ” means, any Subsidiary of Cinergy which (a) for the most recent fiscal year of Cinergy accounted for more than 10% of the consolidated revenues of Cinergy determined in accordance with GAAP or (b) as of the end of such fiscal year, was the owner of more than 10% of the consolidated assets of Cinergy determined in accordance with GAAP, all as shown on the consolidated financial statements of Cinergy for such fiscal year; provided , that, notwithstanding the foregoing, (i) CG&E, PSI Energy and ULH&P shall each be deemed “Material Subsidiaries” of Cinergy and (ii) Cinergy Services, Inc. shall not be deemed a “Material Subsidiary”.
“ Maximum Borrowing Amount ” means, (i) in the case of Cinergy, an amount equal to the Total Commitment then in effect, (ii) in the case of CG&E, an amount equal to the CG&E Sublimit then in effect, (iii) in the case of PSI Energy, an amount equal to the PSI Energy Sublimit then in effect and (iv) in the case of ULH&P, an amount equal to the ULH&P Sublimit then in effect.
“ Moody’s ” means Moody’s Investors Service, Inc. or any successor thereto.
“ Multiemployer Plan ” means any Plan that is a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA.
“ New Lender ” has the meaning specified in Section 2.17.
“ Non-Excluded Taxes ” has the meaning specified in Section 2.13(a).
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“ Non-Recourse Debt ” means Indebtedness of each Borrower or any of their respective Subsidiaries, in respect of which no recourse may be had by the creditors under such Indebtedness against such Borrower or such Subsidiary in its individual capacity or against the assets of such Borrower or such Subsidiary, other than assets which were purchased, constructed or developed by such Borrower or such Subsidiary with the proceeds of such Indebtedness.
“ Non-U.S. Lender ” has the meaning specified in Section 2.13(d).
“ Note ” means any promissory note evidencing Advances.
“ Notice of Borrowing ” has the meaning specified in Section 2.2(a).
“ Notice of Continuation ” shall mean a notice from the Borrower electing the continuation of Eurodollar Rate Advances in accordance with the provisions of Section 2.7(b).
“ Notice of Conversion ” shall mean a notice from the Borrower electing the conversion of Eurodollar Rate Advances to Base Rate Advances or Base Rate Advances to Eurodollar Rate Advances, in each case, in accordance with the provisions of Section 2.7(a).
“ Other Taxes ” has the meaning specified in Section 2.13(b).
“ Outstanding Extensions of Credit ” means, as of any day for the determination thereof, (a) the aggregate principal amount of all Advances outstanding on such day plus (b) the LC Outstandings on such day plus (c) the aggregate amount of all Unreimbursed LC Disbursements outstanding on such day.
“ PBGC ” means the Pension Benefit Guaranty Corporation under Title IV of ERISA, or any successor thereto.
“ Person ” means an individual, partnership, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, limited liability company or other entity, or a government or any political subdivision, agency or instrumentality thereof.
“ Plan ” means an employee pension benefit plan as defined in Section 3(2) of ERISA and in respect of which any Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“ PSI Energy First Mortgage Trust Indenture ” shall mean the first mortgage trust indenture, dated as of September 1, 1939 between PSI Energy (formerly known as Public Service Company or Indiana, Inc. and successor by consolidation to Public Service Company of Indiana) and LaSalle Bank National Association (formerly known as LaSalle National Bank Company and successor, as trustee, to First National Bank of Chicago), as trustee, as amended, modified or supplemented from time to time, and any successor or replacement mortgage trust indenture.
“ PSI Energy Outstanding Extensions of Credit ” means, as of any day for the determination thereof, (a) the aggregate principal amount of all Advances made to PSI Energy outstanding on such day plus (b) the LC Outstandings of PSI Energy on such day plus (c) the aggregate amount of all Unreimbursed LC Disbursements of PSI Energy outstanding on such day.
“ PSI Energy Sublimit ” means $500,000,000.
“ Preferred Trust Securities ”: means Cinergy’s 6.9% preferred trust securities, due February 2007, or any other preferred trust securities issued on terms substantially similar thereto; provided that the amount of any such preferred trust securities issued and outstanding until the Termination Date may not exceed $500,000,000 in the aggregate at any time.
“ Rating Agencies ” means, collectively, Moody’s and S&P; each, individually, a “ Rating Agency ”.
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“ Receivable Financing Transaction ” means any transaction or series of transactions involving a sale for cash of accounts receivable, without recourse based upon the collectibility of the receivables sold, by such Borrower or any of its Subsidiaries to a Special Purpose Subsidiary and a subsequent sale or pledge of such accounts receivable (or an interest therein) by such Special Purpose Subsidiary, in each case without any guarantee by such Borrower or any of its Subsidiaries (other than the Special Purpose Subsidiary).
“ Reference Ratings ” means, with respect to each Borrower, the ratings issued or maintained from time to time by the Rating Agencies in respect of the senior non-credit-enhanced unsecured long-term debt of such Borrower.
“ Register ” has the meaning specified in Section 9.7(c).
“ Removed Borrower ” has the meaning specified in Section 9.1(b).
“ Required Lenders ” means Lenders having more than 50% of the Commitments; provided, however, that if the Commitments shall have been terminated, “Required Lenders” shall mean Lenders holding more than 50% of the then Outstanding Extensions of Credit.
“ Requirement of Law ” means, as to any Person, the certificate of incorporation and by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“ Responsible Officer ” means the chief executive officer, president, chief financial officer, comptroller, vice-president, treasurer or assistant treasurer of the applicable Person.
“ Single Employer Plan ” means any Plan which is covered by Title IV of ERISA, but which is not a Multiemployer Plan.
“ S&P ” means Standard & Poor’s Ratings Group, or any successor thereto.
“ Special Purpose Subsidiary ” means any Material Subsidiary of a Borrower created by a Borrower for the sole purpose of facilitating a Receivable Financing Transaction; provided , that such Special Purpose Subsidiary shall cease to be a Special Purpose Subsidiary if at any time such Special Purpose Subsidiary engages in any business other than Receivable Financing Transactions and activities directly related thereto.
“ SPV ” has the meaning specified in Section 9.7(f).
“ Subsidiary ” means, as to any Person, a corporation, partnership or other entity: (i) of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, directly or indirectly through one or more intermediaries by such Person and/or (ii) the management of which is otherwise controlled, directly or indirectly through one or more intermediaries by such Person.
“ Termination Date ” means, as to any Lender, September 9, 2010, such earlier date of termination in whole of the Commitments pursuant to Section 2.4 or 7.1, or such later date of termination as may be in effect pursuant to an election pursuant to Section 2.18.
“ Total Commitment ” has the meaning specified in Section 2.1(b).
“ Type ” has the meaning specified in the definition of “Advance”.
“ ULH&P First Mortgage Trust Indenture ” shall mean the first mortgage trust indenture, dated as of February 1, 1949 between ULH&P and The Bank of New York (successor to Irving
11
Trust Company), as trustee, as amended, modified or supplemented from time to time, and any successor or replacement mortgage trust indenture.
“ ULH&P Outstanding Extensions of Credit ” means, as of any day for the determination thereof, (a) the aggregate principal amount of all Advances made to ULH&P outstanding on such day plus (b) the LC Outstandings of ULH&P on such day plus (c) the aggregate amount of all Unreimbursed LC Disbursements of ULH&P outstanding on such day.
“ ULH&P Sublimit ” means $65,000,000, as such amount may be increased in accordance with Section 2.5(b).
“ Unreimbursed LC Disbursement ” means the unpaid obligation (or, if the context so requires, the amount of such obligation) of any Borrower to reimburse the LC Bank for a payment made by the LC Bank under a Letter of Credit for the account of such Borrower, but shall not include any portion of such obligation that has been repaid with the proceeds of, or converted to, Advances hereunder.
“ Withdrawal Liability ” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.2. Computation of Time Periods.
In this Agreement in the computation of periods of time from a specified date to a later specified date , the word “from” means “from and including” and the words “to” and “until” each means “to but excluding.”
SECTION 1.3. Accounting Terms.
All accounting terms not specifically defined herein shall be construed in accordance with GAAP consistent with those applied in the preparation of the financial statements referred to in Section 5.1(d).
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.1. The Commitments and Advances.
(a) Each Lender severally agrees, on the terms and conditions hereinafter set forth, to make Advances to each Borrower and to participate in the issuance of Letters of Credit (and the LC Outstandings and Unreimbursed LC Disbursements thereunder) from time to time on any Business Day during the period from the Effective Date until the Termination Date in an aggregate amount not to exceed at any time outstanding the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or, if such Lender has entered into one or more Assignment and Acceptances, set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 9.7(c), as such amount may be reduced pursuant to Section 2.4 (such Lender’s “ Commitment ”).
(b) The sum of the Commitments is hereinafter referred to as the “ Total Commitment ”. The Total Commitment shall be in an initial amount of $2,000,000,000, as the same may be reduced or increased from time to time in accordance with Section 2.4 or Section 2.17 hereof.
(c) Each Borrowing shall be in an aggregate amount not less than $3,000,000 or an integral multiple of $1,000,000 in excess thereof and shall consist of Advances of the same Type made on the same day by the Lenders ratably according to their respective Commitments. Within the limits and
12
subject to the conditions set forth herein, each Borrower may borrow, repay or prepay and reborrow and request the issuance of Letters of Credit under the Commitments.
(d) Notwithstanding anything contained in this Agreement to the contrary, at no time shall (i) the Outstanding Extensions of Credit exceed the Total Commitment as in effect at such time; (ii) the CG&E Outstanding Extensions of Credit exceed the CG&E Sublimit; (iii) the PSI Energy Outstanding Extensions of Credit exceed the PSI Energy Sublimit; or (iii) the ULH&P Outstanding Extensions of Credit exceed the ULH&P Sublimit.
SECTION 2.2. Making the Advances.
(a) Each Borrowing shall be made on notice given by the relevant Borrower to the Administrative Agent via facsimile transmission in accordance with Section 9.2 hereof not later than 11:00 A.M. (New York City time) on the Business Day that is: (i) three Business Days prior to the Borrowing Date of the proposed Borrowing, in the case of a Borrowing comprised of Eurodollar Rate Advances, or (ii) the Borrowing Date of the proposed Borrowing, in the case of a Borrowing comprised of Base Rate Advances. Each such notice of a Borrowing (a “ Notice of Borrowing ”) shall be in substantially the form of Exhibit B hereto, specifying therein the requested Borrowing Date of such Borrowing, the Type of Advances comprising such Borrowing, the aggregate amount of such Borrowing, and the Interest Period to be applicable thereto. Upon receipt of any Notice of Borrowing, the Administrative Agent shall give to each Lender prompt notice thereof and the Administrative Agent shall promptly notify each Lender and the Borrower of the applicable interest rate pursuant to Section 2.8.
(b) Each Lender shall, before 1:00 P.M. (New York City time) on the Borrowing Date of such Borrowing, make available for the account of its Applicable Lending Office to the Administrative Agent at its address referred to in Section 9.2, in immediately available funds, such Lender’s Commitment Percentage of such Borrowing. After the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions set forth in Article IV, the Administrative Agent will make such funds available to the relevant Borrower at the Administrative Agent’s aforesaid address or as otherwise directed by the Borrower.
(c) Anything in Section 2.2(a), above, to the contrary notwithstanding,
(i) if any Lender shall notify the Administrative Agent that the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or that any central bank or other Governmental Authority asserts that it is unlawful, for such Lender or its Eurodollar Lending Office to perform its obligations hereunder to make Eurodollar Rate Advances or to fund or maintain Eurodollar Rate Advances hereunder, the obligation of such Lender to make, fund or maintain Eurodollar Rate Advances shall be suspended, and, until such Lender shall notify the Administrative Agent that the circumstances causing such suspension no longer exist, (1) each Advance by such Lender shall be a Base Rate Advance, and (2) Cinergy shall have the right to replace such Lender by causing such Lender to enter into one or more Assignments and Acceptances in respect of its entire Commitment, the Advances held by it and all other amounts owing to it in respect thereof with one or more banks or other financial institutions selected by Cinergy with the consent of the Administrative Agent (not to be unreasonably withheld), pursuant to Section 9.7 hereof. Each Lender agrees to enter into any such Assignments and Acceptances as may be required by this clause (assuming the same are properly and accurately completed);
(ii) if the Administrative Agent shall have determined in good faith and in its reasonable discretion (which determination shall be conclusive and binding upon the Borrowers) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do
13
not exist for ascertaining the Eurodollar Rate for such Interest Period, the right of the Borrowers to select Eurodollar Rate Advances for such Borrowing or any subsequent Borrowing shall be suspended until the Administrative Agent shall notify the Borrowers and the Lenders that the circumstances causing such suspension no longer exist, and each Advance comprising such Borrowing shall be a Base Rate Advance; and
(iii) if Lenders having more than 50% of the Commitments shall, at least one Business Day before the date of any requested Borrowing, notify the Administrative Agent that the Eurodollar Rate for Eurodollar Rate Advances comprising such Borrowing will not adequately reflect the cost to such Lenders of making or funding their respective Eurodollar Rate Advances for such Borrowing, the right of the Borrowers to select Eurodollar Rate Advances for such Borrowing or any subsequent Borrowing shall be suspended until the Administrative Agent shall notify the Borrowers and the Lenders that the circumstances causing such suspension no longer exist, and each Advance comprising such Borrowing shall be a Base Rate Advance.
(d) Each Notice of Borrowing shall be irrevocable and binding on the relevant Borrower. Unless the Administrative Agent and the relevant Borrower shall have received written notice via facsimile transmission from a Lender prior to (A) 5:00 P.M. (New York City time) one Business Day prior to the date of any Eurodollar Rate Advance Borrowing or (B) 12:00 noon (New York City time) on the date of any Base Rate Advance Borrowing that such Lender will not make available to the Administrative Agent such Lender’s ratable portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with this Section 2.2 and the Administrative Agent may, in reliance upon such assumption, make available to relevant Borrower on such date a corresponding amount. If and to the extent that such Lender shall not have so made such ratable portion available to the Administrative Agent, such Lender and the relevant Borrower severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the relevant Borrower until the date such amount is repaid to the Administrative Agent, at (i) in the case of the relevant Borrower, the interest rate applicable at the time to Advances comprising such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If, prior to such time as the relevant Borrower shall have repaid such amount, such Lender shall repay to the Administrative Agent such corresponding amount with interest as aforesaid, such amount so repaid shall constitute such Lender’s Advance as part of such Borrowing for purposes of this Agreement as if made on the original date of such Borrowing.
(e) The failure of any Lender to make the Advance to be made by it as part of any Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Advance on the date of such Borrowing, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.3. Facility Fee; Letter of Credit Risk Participation Fee; Other Fees.
(a) Cinergy agrees to pay to the Administrative Agent for the account of each Lender a facility fee (the “ Facility Fee ”) on the average daily amount of such Lender’s Commitment (whether used or unused), from the date hereof in the case of each Bank listed on the signature pages hereto and from the effective date specified in the Assignment and Acceptance pursuant to which it became a Lender in the case of any other Lender, until the Termination Date, payable on the basis of the actual number of days elapsed and a year of 360 days, in arrears on the last Business Day of March, June, September and December in each year and on the Termination Date, at the rate per annum set forth below as determined by reference to the Applicable Rating Level for Cinergy:
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|
Applicable |
|
Facility |
|
|
Level I |
|
0.080 |
% |
|
Level II |
|
0.100 |
% |
|
Level III |
|
0.125 |
% |
|
Level IV |
|
0.150 |
% |
|
Level V |
|
0.200 |
% |
; provided that if at any time Cinergy shall fail to pay such Facility Fee within five days of the date when such Facility Fee is due, each of CG&E, PSI Energy and ULH&P severally, but not jointly, agree to pay upon demand to the Administrative Agent for the account of each Lender the amount of such unpaid Facility Fee multiplied by the percentage which the Maximum Borrowing Amount applicable to such Borrower represents of the Total Commitment.
(b) Each Borrower agrees to pay to the Administrative Agent for the account of each Lender, ratably in accordance with their respective Commitments, a letter of credit risk participation fee on the average daily amount of LC Outstandings with respect to Letters of Credit issued for its account, from the date hereof in the case of each Bank listed on the signature pages hereto, and from the effective date specified in the Assignment and Acceptance pursuant to which it became a Lender in the case of any other Lender, until the Termination Date, payable (on the basis of the actual number of days elapsed and a year of 360 days) on the last Business day of March, June, September and December in each year and on the Termination Date, at a rate per annum equal to the Applicable Margin for Eurodollar Rate Advances then determined to be in effect for such Borrower plus, during any period from the occurrence of an Event of Default under Section 7.1(a), to the day when such Event of Default shall be cured or waived, 2% per annum .
(c) The Borrowers shall pay to the Administrative Agent, for its own account and for the account of the Lenders such other fees as have been or may from time to time be agreed between them in writing.
(d) Any change in the Facility Fee or letter of credit risk participation fee caused by a change in the Applicable Rating Level shall take effect at the time such change in the Applicable Rating Level shall occur.
(e) Each Borrower shall pay to the LC Bank a fronting fee and such other fees as such Borrower and the LC Bank shall agree to from time to time in writing.
SECTION 2.4. Optional Reduction of the Commitments.
(a) Cinergy shall have the right, upon at least three Business Days’ irrevocable notice to the Administrative Agent, to terminate in whole or permanently reduce ratably in part the Commitments by either terminating in whole or in part the Total Commitment as Cinergy may specify in such notice; provided , that:
(i) each such partial reduction shall be in the aggregate amount of $10,000,000 or any integral multiple of $1,000,000 in excess thereof and shall reduce ratably and permanently
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the amount then in effect of (A) the Commitments and (B) the Total Commitment, as specified by Cinergy ;
(ii) any such reduction shall be accompanied by (i) the prepayment of Advances, together with all interest thereon accrued to the date of such prepayment or repayment on the amount prepaid or repaid and, in the case of prepayments of Eurodollar Rate Advances, any amount payable to the Lenders pursuant to Section 2.15 and/or (ii) in the case of any LC Outstandings, the deposit in cash in a cash collateral account established with the Administrative Agent, on terms and conditions satisfactory to the Administrative Agent and the LC Bank, in each case to the extent, if any, that the Outstanding Extensions of Credit exceed the amount of the Total Commitment as proposed to be reduced; and
(iii) Cinergy shall not have the right to reduce the Total Commitment to an amount less than the aggregate then existing LC Outstandings.
(b) CG&E shall have the right, upon at least three Business Days’ irrevocable notice to the Administrative Agent, to permanently reduce or terminate the CG&E Sublimit in whole or in part as CG&E may specify in such notice; provided that:
(i) each such partial reduction shall be in the aggregate amount of $10,000,000 or any integral multiple of $1,000,000 in excess thereof;
(ii) any such reduction shall be accompanied by (i) the prepayment of Advances, together with all interest thereon accrued to the date of such prepayment or repayment on the amount prepaid or repaid and, in the case of prepayments of Eurodollar Rate Advances, any amount payable to the Lenders pursuant to Section 2.15 and/or (ii) in the case of any LC Outstandings, the deposit in cash in a cash collateral account established with the Administrative Agent, on terms and conditions satisfactory to the Administrative Agent and the LC Bank, in each case to the extent, if any, that the CG&E Outstanding Extensions of Credit exceed the amount of the CG&E Sublimit as proposed to be reduced; and
(iii) CG&E shall not have the right to reduce the CG&E Sublimit to an amount less than the aggregate then existing LC Outstandings with respect to Letters of Credit issued for its account.
(c) PSI Energy shall have the right, upon at least three Business Days’ irrevocable notice to the Administrative Agent, to permanently reduce or terminate the PSI Energy Sublimit in whole or in part as PSI Energy may specify in such notice; provided that:
(i) each such partial reduction shall be in the aggregate amount of $10,000,000 or any integral multiple of $1,000,000 in excess thereof;
(ii) any such reduction shall be accompanied by (i) the prepayment of Advances, together with all interest thereon accrued to the date of such prepayment or repayment on the amount prepaid or repaid and, in the case of prepayments of Eurodollar Rate Advances, any amount payable to the Lenders pursuant to Section 2.15 and/or (ii) (ii) in the case of any LC Outstandings, the deposit in cash in a cash collateral account established with the Administrative Agent, on terms and conditions satisfactory to the Administrative Agent and the LC Bank, in each case to the extent, if any, that the PSI Energy Outstanding Extensions of Credit exceed the amount of the PSI Energy Sublimit as proposed to be reduced; and
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(iii) PSI Energy shall not have the right to reduce the PSI Energy Sublimit to an amount less than the aggregate then existing LC Outstandings with respect to Letters of Credit issued for its account.
(d) ULH&P shall have the right, upon at least three Business Days’ irrevocable notice to the Administrative Agent, to permanently reduce or terminate the ULH&P Sublimit in whole or in part as ULH&P may specify in such notice; provided that:
(i) each such partial reduction shall be in the aggregate amount of $10,000,000 or any integral multiple of $1,000,000 in excess thereof;
(ii) any such reduction shall be accompanied by (i) the prepayment of Advances, together with all interest thereon accrued to the date of such prepayment or repayment on the amount prepaid or repaid and, in the case of prepayments of Eurodollar Rate Advances, any amount payable to the Lenders pursuant to Section 2.15 and/or (ii) (ii) in the case of any LC Outstandings, the deposit in cash in a cash collateral account established with the Administrative Agent, on terms and conditions satisfactory to the Administrative Agent and the LC Bank, in each case to the extent, if any, that the ULH&P Outstanding Extensions of Credit exceed the amount of the ULH&P Sublimit as proposed to be reduced; and
(iii) ULH&P shall not have the right to reduce the ULH&P Sublimit to an amount less than the aggregate then existing LC Outstandings with respect to Letters of Credit issued for its account.
SECTION 2.5. Mandatory Reduction of CG&E Sublimit; Increase in ULH&P Sublimit.
(a) The CG&E Sublimit shall, upon the disposition by CG&E or its Subsidiaries of all or substantially all of the generation assets of CG&E and its Subsidiaries, other than to a direct or indirect wholly-owned Subsidiary of CG&E, be permanently reduced to $250,000,000. Such reduction shall be accompanied by (i) the prepayment of Advances, together with all interest thereon accrued to the date of such prepayment or repayment on the amount prepaid or repaid and, in the case of prepayments of Eurodollar Rate Advances, any amount payable to the Lenders pursuant to Section 2.15, and/or (ii) the deposit in cash in a cash collateral account established with the Administrative Agent, on terms and conditions satisfactory to the Administrative Agent and the LC Bank, in each case to the extent, if any, that the CG&E Outstanding Extensions of Credit exceed the amount of the CG&E Sublimit, as reduced. Notwithstanding the above, the CG&E Sublimit shall not be reduced if the Consolidated Net Worth of CG&E following such disposition of generation assets is at least $1,000,000,000.
(b) The ULH&P Sublimit may be increased to $100,000,000 upon receipt by the Administrative Agent of a notice from a Responsible Officer of ULH&P certifying that the transactions described in Schedule 2.5(b) have been consummated.
SECTION 2.6. Repayment of Advances; Prepayment.
(a) Each Borrower shall repay the outstanding principal amount of all Advances made to it no later than the Termination Date.
(b) Each Borrower may upon notice given by such Borrower to the Administrative Agent via facsimile transmission in accordance with Section 9.2 hereof not later than 11:00 A.M. (New York City time) on the Business Day that is: (i) three Business Days prior to the proposed prepayment of Eurodollar Rate Advances, or (ii) one Business Day prior to the proposed prepayment of Base Rate Advances, stating the proposed date and aggregate principal amount of the prepayment and if such notice is given such
17
Borrower shall, prepay the outstanding principal amounts of the Advances made as part of the same Borrowing in whole or ratably in part, together with accrued interest to the date of such prepayment on the principal amount prepaid; provided , however , that (A) each partial prepayment shall be in an aggregate principal amount not less than $3,000,000 or any integral multiple of $1,000,000 in excess thereof and (B) in the case of any such prepayment of a Eurodollar Rate Advance, such Borrower shall be obligated to reimburse the Lenders in respect thereof pursuant to Section 2.14 on the date of such prepayment.
(c) Until such time as any Borrower designates all or a portion of its Maximum Borrowing Amount as “long-term” pursuant to a notice (each, a “ Long-Term Debt Designation ”) substantially in the form of Exhibit F hereto, each Borrower designates that Advances made to such Borrower which have not been designated as long term shall be repayable within 365 days from the date of the Advance. Any such Long-Term Debt Designation may designate any outstanding Advance made to such Borrower as a long-term loan, repayable more than 365 days from the date of the Advance but no later than the Termination Date. Designation of any outstanding Advance as long-term shall not affect the Type of such Advance or the Interest Rate Period applicable thereto.
SECTION 2.7. Conversion and Continuation Options.
(a) The Borrower may elect from time to time to convert Eurodollar Rate Advances to Base Rate Advances by giving the Administrative Agent prior irrevocable notice of such election no later than 11:00 A.M., New York City time, on the Business Day of the proposed conversion date, provided that any such conversion of Eurodollar Rate Advances may only be made on the last day of an Interest Period with respect thereto. The Borrower may elect from time to time to convert Base Rate Advances to Eurodollar Rate Advances by giving the Administrative Agent prior irrevocable notice of such election no later than 11:00 A.M., New York City time, three Business Days prior to the proposed conversion date (which notice shall specify the length of the initial Interest Period therefor), `provided that no Base Rate Advance may be converted into a Eurodollar Rate Advance when any Event of Default has occurred and is continuing and the Administrative Agent or the Required Lenders have determined in its or their sole discretion not to permit such conversions. Upon receipt of any such notice the Administrative Agent shall promptly notify each Lender thereof.
(b) Any Eurodollar Rate Advance may be continued as such upon the expiration of the then current Interest Period with respect thereto by the Borrower giving irrevocable notice to the Administrative Agent not later than 11:00 A.M., New York City time, three Business Days prior to the last day of the then current Interest Period, of the length of the next Interest Period to be applicable to such Advances, provided that no Eurodollar Rate Advance may be continued as such when any Event of Default has occurred and is continuing and the Administrative Agent has or the Required Lenders have determined in its or their sole discretion not to permit such continuations. Upon receipt of any such notice the Administrative Agent shall promptly notify each Lender thereof.
SECTION 2.8. Interest on Advances.
Each Borrower shall pay interest on the unpaid principal amount of each Advance made to it by each Lender under the Total Commitment from the date such Advance is made until such principal amount shall be paid in full, at the following rates per annum :
(a) Base Rate Advances . If such Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of (i) the Base Rate in effect from time to time and (ii) the Applicable Margin, payable on the last Business Day of each March, June, September and December to occur while such Advance is outstanding and on the date such Base Rate Advance shall be paid in full; provided , however , that any amount of principal or interest which is not paid when due (whether at stated maturity, by acceleration or
18
otherwise) shall bear interest, from the date on which such amount is due until such amount is paid in full, payable on demand, at a rate per annum equal at all times to 2% per annum plus the Base Rate in effect from time to time.
(b) Eurodollar Rate Advances . If such Advance is a Eurodollar Rate Advance, a rate per annum equal at all times during the Interest Period for such Advance to the sum of (i) the Eurodollar Rate for such Interest Period plus (ii) the Applicable Margin, payable on the last day of such Interest Period, and also, in the case of any Interest Period of six months’ duration, on that day of the third month of such Interest Period which corresponds with the first day of such Interest Period (or, if any such month does not have a corresponding day, then on the last day of such third month); provided , however , that any amount of principal or interest which is not paid when due (whether at stated maturity, by acceleration or otherwise) shall bear interest, from the date on which such amount is due until such amount is paid in full, payable on demand, at a rate per annum equal at all times to 2% per annum above the rate per annum required to be paid on such Advance immediately prior to the date on which such amount became due.
SECTION 2.9. Additional Interest on Eurodollar Rate Advances.
Each Borrower shall pay to each Lender, so long as such Lender shall be required under regulations of the Board of Governors of the Federal Reserve System to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Liabilities, additional interest on the unpaid principal amount of each Eurodollar Rate Advance made to it by such Lender, from the date of such Advance until such principal amount is paid in full, at an interest rate per annum equal at all times to the difference obtained by subtracting (a) the Eurodollar Rate for the Interest Period for such Eurodollar Rate Advance from (b) the rate obtained by dividing such Eurodollar Rate by a percentage equal to 100% minus the LIBOR Reserve Percentage of such Lender for such Interest Period or such term, as the case may be, payable on each date on which interest is payable on such Advance. Such additional interest shall be determined by such Lender and notified to such Borrower through the Administrative Agent.
SECTION 2.10. Interest Rate Determination.
The Administrative Agent shall give prompt notice to the Borrowers and the Lenders of the applicable interest rate determined by the Administrative Agent for purposes of Section 2.8(a) or Section 2.8(b).
SECTION 2.11. Increased Costs; Capital Adequacy.
(a) If, due to either (i) the introduction of or any change in or in the interpretation of any law or regulation after the date hereof, or (ii) the compliance with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law) issued or made after the date hereof, there shall be reasonably incurred any increase in (A) the cost to any Lender of agreeing to make or making, funding or maintaining Eurodollar Rate Advances, or of participating in the issuance, maintenance or funding of any Letter of Credit or any Unreimbursed LC Disbursement, or (B) the cost to the LC Bank of issuing or maintaining any Letter of Credit or any Unreimbursed LC Disbursement, then the relevant Borrower shall from time to time, upon demand by such Lender or the LC Bank, as the case may be (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender or the LC Bank, as the case may be, additional amounts sufficient to compensate such Lender or the LC Bank, as the case may be, for such increased cost.
(b) If any Lender or the LC Bank determines that (i) compliance with any law or regulation or any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Lender, any Person controlling such Lender or the LC Bank, whether directly, or indirectly as a
19
result of commitments of any such Person controlling such Lender or the LC Bank (but without duplication), and (ii) the amount of such capital is increased by or based upon (A) the existence of such Lender’s or the LC Bank’s commitment to lend or issue or participate in any Letter of Credit hereunder, or (B) the participation in or issuance or maintenance of any Letter of Credit or Advance or (C) other similar such commitments hereunder, then, upon demand by such Lender, such Person controlling such Lender or the LC Bank, the relevant Borrower shall immediately pay to the Administrative Agent for the account of such Lender or the LC Bank from time to time as specified by such Lender or the LC Bank additional amounts sufficient to compensate such Lender, such Person controlling such Lender or the LC Bank in the light of such circumstances, to the extent that such Lender, such Person controlling such Lender or the LC Bank reasonably determines such increase in capital to be allocable to the transactions contemplated hereby.
(c) Each Borrower’s obligations under this Section 2.11 shall survive the repayment of all amounts owing to the Lenders, the LC Bank and the Administrative Agent under the Financing Documents and the termination of the Commitments.
SECTION 2.12. Payments and Computations.
(a) Each Borrower shall make each payment hereunder not later than 11:00 A.M. (New York City time) on the day when due in U.S. dollars and without offset or counterclaim to the Administrative Agent at its address referred to in Section 9.2 in same day funds, and, in the case of a payment made to the Administrative Agent for the account of the Lenders, such payment shall be deemed to have been received by the Lenders upon receipt thereof by the Administrative Agent. The Administrative Agent will promptly thereafter cause to be distributed like funds to the Lenders entitled thereto for the account of their respective Applicable Lending Offices, in each case to be applied in accordance with the terms of this Agreement.
(b) All computations of interest based on the Base Rate (when based on the prime rate) shall be made by the Administrative Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of interest based on the Eurodollar Rate or Federal Funds Rate (including the Base Rate when based on the Federal Funds Rate) shall be made by the Administrative Agent, and all computations of interest pursuant to Section 2.9 shall be made by a Lender, on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable. Each determination by the Administrative Agent (or, in the case of Section 2.9, by a Lender) of an interest rate hereunder shall be conclusive and binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or any fee payable or contemplated hereunder, as the case may be; provided , however , if such extension would cause payment of interest on or principal of Eurodollar Rate Advances to be made in the next following calendar month, such payment shall be made on the next preceding Business Day.
(d) Unless the Administrative Agent shall have received notice from a Borrower prior to the date on which any payment is due to the Lenders hereunder that such Borrower will not make such payment in full, the Administrative Agent may assume that such Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent such Borrower shall not have so made such payment in full to the Administrative Agent, each Lender shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender together with interest thereon, for each day from the date such amount
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is distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.13. Taxes.
(a) Any and all payments by the Borrowers hereunder shall be made, in accordance with Section 2.12, free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net income taxes, taxes on overall capital and franchise or capital taxes (imposed in lieu of net income taxes) imposed on the Administrative Agent or any Lender as a result of a present or former connection between the Administrative Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from the Administrative Agent or such Lender having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“ Non-Excluded Taxes ”) or Other Taxes (as defined below) are required to be withheld from any amounts payable to the Administrative Agent or any Lender hereunder, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement, provided , however , that no Borrower shall be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply with the requirements of paragraph (d) or (e) of this Section 2.13 at all times during the continuance of this agreement or (ii) that are United States withholding taxes imposed on amounts payable to such Lender at the time such Lender becomes a party to this Agreement, except to the extent that such Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from such Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph.
(b) In addition, each Borrower agrees to pay any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement (“ Other Taxes ”).
(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by a Borrower, as promptly as possible thereafter such Borrower shall send to the Administrative Agent for its own account or for the account of the relevant Lender, as the case may be, a certified copy of an original official receipt received by such Borrower showing payment thereof. If such Borrower fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, such Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure; provided no Borrower shall be liable hereunder for any incremental taxes, interest or penalties resulting from the failure to pay when due any Non-Excluded Taxes or Other Taxes imposed directly on the Administrative Agent or any Lender if such Borrower shall not have received written notice at least five Business Days prior to the due date thereof.
(d) Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30) of the Code (a “ Non-U.S. Lender ”) shall deliver to the Borrowers and the Administrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c)
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of the Code with respect to payments of “portfolio interest”, a statement substantially in the form of Exhibit H and a Form W-8BEN, or any subsequent versions thereof or successors thereto, properly completed and duly executed by such Non-U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrowers under this Agreement. Such forms shall be delivered by each Non-U.S. Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation). In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrowers at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrowers (or any other form of certification adopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant to this paragraph that such Non-U.S. Lender is not legally able to deliver.
(e) A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax under the law of the jurisdiction in which any Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to such Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by such Borrower, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate, provided that such Lender is legally entitled to complete, execute and deliver such documentation and in such Lender’s judgment such completion, execution or submission would not materially prejudice the legal position of such Lender.
(f) The agreements in this Section 2.13 shall survive the termination of this Agreement and the payment of the Advances and all other amounts payable hereunder. The Lenders and the
AGREEMENTS / CONTRACTS
CLAUSES
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